Emma Codd on gender pay gap

ME PoV Spring 2018 issue

What is gender pay gap reporting?

Under new legislation that came into force in April 2017, UK employers with more than 250 employees are now required to publish their gender pay gap on an annual basis. The gender pay gap serves to illustrate the percentage difference between the average male and female earnings within an organization as a whole. Thus, it is not a measure of whether men and women are paid the same for the same role (namely, equal pay, for which there has been legislation in place in the UK since 1970.)

The legislation is very prescriptive as to the data that must be publicly reported by employers, with a requirement to calculate and report:

Their average gender pay gap (both mean and median averages)

Their average gender bonus gap (both mean and median averages)

The proportion of men and women receiving bonuses

The proportion of men and women in each quartile of the organization’s pay structure

It also requires that the data used for calculations to be as at 5 April of the reporting year, thus ensuring that each employer reporting is doing so at the same point in time.

You acknowledge that Deloitte UK has a gender pay gap and that the firm has “fully understood why we have a gap” and that it is taking clear steps to close it–what are the main reasons for the firm’s gender pay gap and what are the actions being taken to close it?

Increasing gender pay gap transparency is something we've taken a leading and visible position on for some time in the UK. We believe it will play a critical role in achieving greater gender balance within organizations. To this end, we have been voluntarily reporting our gender pay gap in the UK since 2015, well before the new legislation came into force, and we also worked closely with the UK’s Government Equalities Office to produce their 2016 report Trailblazing Transparency: Mending the Gap. Our focus on gender pay gap transparency also led to us being awarded the prestigious Business in the Community Transparency Award in 2016.

As at 5 April 2017, our mean pay gap was 18.2 percent (median: 15.3 percent) and mean bonus gap was 50.9 percent (median: 39.1 percent.) While the new regulations require a slightly different calculating methodology (and our previous reports did not include our bonus gap), when we use a like for like calculation year on year we can see that our gap is reducing.

The analysis conducted in support of our gender pay gap report showed the clear cause of our gap, namely that women hold significantly fewer senior positions within our firm than men.While women made up 43 percent of our overall workforce in April 2017, only 18 percent of our partners (those attracting the highest levels of remuneration) were female. Indeed, further analysis shows that once this structural issue is removed our mean pay gap reduces to around 2.5 percent.

To close our gender pay gap we therefore need to ensure that our most senior grades are balanced from a gender perspective and we know this takes long-term commitment and a sustained focus led by our firm’s leadership.

By the time we reported our gender pay gap under the new legislation we were three years into a clear plan to improve gender balance that we had published to allour firm. We also had an existing target that we had set in 2012, namely that in 2020, 25 percent of our UK partners will be female. At the time this target was set this stood at 12 percent.

Our 2014 plan sets out the actions that we need to take to improve gender balance. It makes clear that success will only be achieved through a focus on culture and targeted interventions. When devising the plan we conducted a rigorous data analysis to identify our pain points: those points in our career lifecycle that were adversely impacting our gender balance. We asked our female employees to tell us about the things that were affecting their experience with us. This resulted in us understanding, not only of the interventions that would make a difference, but also that without a focus on ensuring that we always provide an inclusive culture underpinned by respect, where women are able to balance a successful career with life outside work, the interventions would have little impact.

Our plan sets out the areas on which we are focusing our efforts. These include:

Ensuring that we are able to identify our high potential female talent and then provide them with the sponsorship and tailored development required;

Enabling women to re-enter the workplace after a career break of two or more years through our Return to Work internship program; and

Ensuring that primary carers (male and female) are provided with coaching support–and the support of their line manager–when coming back to work from maternity/parental leave.

Our data shows that our focus on culture has had the most significant impact on our numbers. Our people tell us that they now feel trusted to work in a way that is beneficial for both, themselves and the business, and are therefore able to balance work and life. They also tell us that the environment within which they work is truly inclusive.

We know we’re moving in the right direction: the proportion of female partners at Deloitte UK has increased from 12 percent in 2012 to 19 percent in 2017. We are recruiting more women, both at entry level and experienced hire, and women are choosing to stay with us.

While we know that we have a long way to go, we believe that we are focusing on the right things to ensure that we really do achieve gender balance and therefore fully close our gender pay gap.

by Emma Codd, Managing Partner for Talent Deloitte North West Europe and Deloitte UK (named as one of FTHeroes Top 50 Female Champions of Women in Business in the UK)

Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. Please see About Deloitte to learn more about our global network of member firms.